Question: On January 1 , 2 0 2 3 , Archer, Incorporated, paid $ 1 0 0 , 0 0 0 for a 3 0 %

On January 1,2023, Archer, Incorporated, paid $100,000 for a 30% interest in Harley Corporation. This investee had assets with a book value of $550,000 and liabilities of $300,000. A patent held by Harley having a book value of $10,000 was actually worth $40,000 with a six-year remaining life. Any goodwill associated with this acquisition is considered to have an indefinite life. During 2023, Harley reported net income of $50,000 and paid dividends of $20,000 while in 2024 it reported net income of $75,000 and dividends of $30,000. Assume Archer has the ability to significantly influence the operations of Harley.
The equity in income of Harley for 2023, is
Multiple Choice
$50,000.
$15,000.
$13,500.
$9,000.
$7,500.

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